PropTech, a blend of the words property and technology, refers to the utilisation of technology as a solution to challenges in the real estate sector. Specifically, technology is used to create or renovate services offered in real estate to buy, sell, rent, develop, market and manage property in a more efficient and effective way. The real estate industry is ripe and ready for change, and a wave of innovation has been long-awaited. PropTech is paving the way for increased efficiency and its continued improvements. Let's examine the impact that the different stages of PropTech have impacted the property industry.

How the different stages of PropTech are changing the Property Industry

An overview of PropTech is supposed to contribute to a better understanding of how the new technologies are influencing the Property management, agent service and new tech product. Let's see how the different stages of PropTech are changing the Property Industry.

PropTech 1.0

PropTech began with PropTech 1.0 in 2007 when startups like PropertyGuru were launched to address consumers' need for a single online portal that collated property listings. These portals took the form of aggregators or marketplaces, and presented a relatively low degree of technical challenge with a direct-to-consumer or pay-to-list business model. The primary focus of Proptech 1.0 was on improving searchability ratios, using technology to list and analyse real estate assets. PropTech 1.0 had a relatively smaller audience, due to a lack of technical knowledge and the initial reluctance to accept technology in the Real Estate Sector.

PropTech 2.0

Proptech 2.0 emerged in 2013 to address the needs of small businesses and brokers that were more complex than those of consumers. Start-ups like Propstack, a Commercial Property Intelligence platform based in India, provided tools that improved decision-making and business processes. The growing availability of tech talent enabled start-ups to employ more advanced technology such as Data and Analytics or Virtual Reality (VR), while using a pay-to-use or Software as a Service (SaaS) business model. This technology in the property industry can effectively eliminate paper contracts and simplify the conveyancing process, saving thousands of dollars in fees and time in complexities. PropTech 2.0 utilised existing technology concepts of the sharing economy, including FinTech, real estate, contracts, data analytics, smart building and smart homes.

Proptech 3.0

The current Proptech 3.0 wave – arising shortly after Proptech 2.0 in 2014 – is led by startups employing emergent technology such as Unmanned Aerial Vehicle (UAV) and solar power to address enterprise needs. These products, such as QwikSpec's cloud-based platform for field inspections and data analytics, require heavy upfront investment and domain knowledge in the property sector. It is worth noting that such innovations are built from the ground up to address complex enterprise needs instead of being adapted from products of other sectors. New technology has even enabled homes to become energy producers, and includes the use of autonomous drones, big data and artificial intelligence (AI) to come together to transform the property sector. PropTech 3.0 also incorporates the development and application of blockchain technology —a cryptographically secure ledger that stores all transactions made in a system across many different computers, allowing the property industry to be radically transformed in the areas of transparency and liquidity.

Proptech Industry will be a key driver

It is important not to underestimate how far PropTech 3.0 can take us. Property technology will dramatically change the way we approach real estate planning by making it easier to monitor large portfolios in real time. PropTech is paving the way for increased efficiency, and its continued improvements mean it will be here for a long time and continue to grow from strength to strength.

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